Dakota Beacon

Saturday, February 23, 2019

To the readers of the Dakota Beacon: I originally submitted the following article to American Thinker, for the sole reason that it is actually a national issue of some importance which I feel has been more or less shoved in the closet in a feeding frenzy of criticism on a national level of the feckless Alexandria Ocasio-Cortez. True, this woman has not said much that makes sense. However, attacking her because of the recent decision of Amazon not to locate in New York, whether it actually had anything to do with her leadership on the matter or not, merely because it is AOC, make less sense. The basic principle seemed to have been lost in the flurry. Following is the response from J.R. Dunn of American Thinker. I was really quite shocked. One would be led to believe that the readers are “thinkers”, not mindless knee-jerk reactionaries Perhaps they are, but because of the assumption of Mr. Dunn they won’t get the chance to think about my point on this issue. So because I do know the kind of thinkers who read the Dakota Beacon, here it is, along with Mr. Dunn’s comment.

Sally:

I'm afraid we'll have to pass on this one. AT readers will not tolerate a piece expressing agreement with Sandy O on anything at all. They will get that far and no farther, and they will then crucify you. Sorry, but that's how it goes.

Best,

JR Dunn

So, for readers who can think for themselves, here is my article:

Recently, newly-minted Congresswoman Alexandria Ocasio-Cortez has come under a good deal of flak for her celebration in defeating Amazon’s bid to locate in New York, a development which promised some 25,000 new jobs. Ocasio-Cortez cheered the news, declaring that now the money, some $3 billion or so, of the ghost revenue which would have been lost had Bezos taken up the deal offered by New York of tax benefits and what other considerations were on the table.could be spent on hiring teachers.

Of course, Mayor DeBlasio and others are livid with her for leading the charge against this “economic development” scheme. Republicans, too, are called upon by some “conservatives” to agree that here is just another piece of evidence that Ocasio-Cortez is being stupid. Conservatives should know better.

While I cannot agree with Ocasio-Cortez on much else, including the idea that money not collected from Bezos should be spent on hiring teachers or other government programs, the principle behind the Amazon plan is disastrously flawed and conservatives, above all others, should reject this kind of idea.

This style of economic development must be stopped. We have seen this called “free enterprise” or “capitalism”. It is not. It is crony capitalism. This creates an oligarchy, the same kind of thing we see in clumsy post-soviet economies. It has nothing to do with true capitalism or any kind of free enterprise. In normal capitalism an entrepreneur begins an enterprise and may borrow to extend it, pays taxes on it, employs workers, who then pay taxes on their income and buy homes and pay property tax on them. While we may strongly differ on the principle of property tax, let’s at least agree on the idea that everyone should pay at an equal rate. Anything else amounts to a violation of the Constitution. Citizens are promised “equal protection of the law”. This means that if Bezos is protected from paying a tax, we must all be so protected.

This distortion of capitalism has destroyed seedling home-grown businesses and has hobbled those it has not completely destroyed. It has burdened private property owners. If we don’t collect at tax from one business all the others must pick up the slack and struggle on while the recipient sails forth with grandiose business plans which may or may not float on their own. This is wrong.

Last year we saw a private entity come into our town, buy valuable downtown property at a drastic discount (a public park sold out from under the people by the City Council), forgiven property taxes for at least 10 years as well as state income taxes for the same period. In the meantime, their development is supposed to be a high-rise of condos, each selling for $250,000. It is difficult to justify this in any way. Looking at the several small, legitimate businesses which surround it, one is aware that each of them will have to pay more for a lot less. The downtown community, residential and business, supported the idea of this little “pocket” park, a tree-shaded respite from concrete and bricks, a little place to enjoy the sunshine, the lovely flowers that one business owner had donated, as well as artwork by many in the community, students and accomplished sculptors. It was the venue for weddings, photographs, a lunch break during a summer’s afternoon. That’s gone now. The city sold public property, a park, for about $50K, and then forgave taxes, all in the name of “economic development”.

We all want economic development - - don’t get me wrong. But there is a right way and a wrong way to do this. Most conservatives would not cheer for a government project taking over valuable land and “developing” it with their tax dollars. Neither should they promote the kind of project which cannot stand on its own. Such a business should not be propped up by tax breaks or other giveaways or eminent domain condemnations. This is un-American to say the least. A business which looks so good as to make the City Council not want it to get away has no need of this kind of subsidy. After all, a tax break IS a subsidy. We should be avoiding any more subsidizing of businesses or services.

The way to encourage legitimate development is to strive to reduce the tax rates for ALL citizens across the boards. If the tax climate in general is favorable, if waste in government is eliminated or at least reduced, business will compete for the venue, not the other way around. As it stands now, a large (or large in the imagination of someone) project shops around, jacking up the deal all over the United States. Sure, if Jeff Bezos can’t locate in New York or just gets miffed with Ocasio-Cortez, he can just disappear like a genie and reappear in Virginia or somewhere else. After all, they will also accommodate him. But just think of the benefits to New Yorkers if everyone’s tax burden were lightened. How many other substantial companies might locate there and employ many thousands of workers? How many who are giving up or moving elsewhere might stay in business in New York and expand or maintain and employ thousands of workers? And would this not be a better investment in the economy than one giant employer to whom you grant special favors and bribe to come there? How long will Amazon stay where its special status expires or its benefits run out?

I hate to find myself on the same side of any question with Alexandria Ocasio-Cortez, but in this instance I must, even though it may be for different or conflicting reasons. No, we should not substitute the “investment” we might make in a corporate entity locating in our community with a government program or expenditure. But we should definitely make our communities attractive to everyone. Competition is the fuel of free enterprise. We need to foster that, not set up special relations with a favored few. This is the way to losing competition in our economy, not revving it up. And when competition is finally defeated, costs go up, not down, and value is free to drift down. We all know this. Our city councils and commissions know this but somehow they find it highly profitable to accept the cronyism. We should have no such thing as “insiders” or “outsiders” in our business environment. To this important extent, I find myself traveling the same way as Ocasio-Cortez, if only for a short distance, and however reluctantly.

Too bad that “principle” hast become an outdated virtue. Would that our highly respected conservative commentators would pause a moment, avoid the knee-jerk temptation to throw another pie in the face of Ocasio-Cortez and think a little farther than this afternoon’s balance sheet.

I really would like to know what you think. Discussion is important and this issue is one we will all be dealing with at some point. Please send me your comments. My email address is: (JavaScript must be enabled to view this email address).